What are BNSF Railway's coal dust mitigation requirements?

Item 100 of BNSF Price List 6041-B contains BNSF's coal dust mitigation requirements (the "Coal Loading Rule"). The current Coal Loading Rule has been in effect since October 1, 2011. The Coal Loading Rule specifically requires all shippers loading coal at any Montana or Wyoming mine to take measures to load cars in such a way that ensures coal dust losses in transit are reduced by at least 85% compared to cars where no remedial measures have been taken. The Coal Loading Rule also has a "safe harbor" provision stating that a shipper will be deemed to be in compliance with BNSF's Coal Loading Rule if it loads cars in compliance with BNSF's published Load Profile Template, and either (i) applies an approved topper agent to the loaded cars in the specified manner, or (ii) uses another method of coal dust suppression that, together with profiling, reduces coal dust losses in transit by the required 85%.

The Surface Transportation Board (STB) issued a decision in Finance Docket No. 35557: Reasonableness of BNSF Railway Company Coal Dust Mitigation Tariff Provisions in which the STB affirmed the reasonableness of the Coal Loading Rule and upheld its enforceability. This affirmation was subject to BNSF making a minor modification, which is now reflected in the current rule.

Why is BNSF concerned about coal dust in the Powder River Basin?

Since 2005, BNSF has been at the forefront of extensive research regarding the impacts of coal dust escaping from loaded coal cars on rail lines in the Powder River Basin (PRB), which is located in Wyoming and Montana. From these studies, BNSF has determined that coal dust poses a serious threat to the stability of the track structure and the operational integrity of our lines in, and close to, the mines in the PRB. The STB, our regulating agency, has confirmed that coal dust is a harmful contaminant of rail ballast. Tests have shown that dusting events from untreated cars occur with the most frequency close to the mine loading points in the PRB and materially decrease as the railcars move further from the PRB.

BNSF does not believe that any commodity should be permitted to escape from its shipping container and foul the railroad's roadbed. Shippers are responsible for securing their freight for transit by rail. Studies and experience have demonstrated that shippers can take steps in the loading of coal cars using existing, cost-effective technology that will substantially reduce coal dusting events.

BNSF has found that coal dust releases can be partially reduced by loading coal cars with a modified loading chute. Proper use of the modified loading chute will produce a rounded contour of the coal in coal cars that eliminates the sharp angles and irregular surfaces that can promote the loss of coal dust when cars are in transit. BNSF has established a load profile template that is currently being used by PRB coal mines. The profile is included in Appendix A to BNSF Item 100 of BNSF Price List 6041-B, and appears below:

While loading coal cars in conformance with BNSF's load profile template reduces the amount of coal dust exiting the coal cars, shippers must take additional measures, such as the application of a topper agent or surfactant to the surface of the loaded coal, to effectively mitigate the loss of coal dust during transit. The Coal Loading Rule requires that coal dust losses in transit be reduced by at least 85% compared to cars where no remedial measures have been taken. Testing has demonstrated that profiling must be combined with additional measures to meet the 85% reduction requirement. In addition to proper load profiling, topper agents can be sprayed over the loaded coal by the shipper or its mine agent at the mine origin to keep the coal in place during transit.

How do you know that these measures will be effective in the PRB?

Since 2005, BNSF has been conducting studies in the PRB of coal dust and various measures available to reduce the release of coal dust from loaded cars. These studies have confirmed that the proper application of certain topper agents, along with proper load profiling, can reduce coal dust levels by at least 85 percent. Also, during a seven month period in 2010, BNSF undertook a large-scale field trial ("Super Trial") of coal dust mitigation measures so that shippers could obtain more information on the effectiveness of various mitigation measures. The trial involved participation by vendors as well as several mines and coal shippers. Different topper agents were tested in the laboratory and in the field on operating coal trains to determine the effectiveness of different products and services in reducing coal dust releases. The Super Trial confirmed that the application of certain topper agents, when used in combination with a modified loading chute, can reduce coal dust losses by at least 85%.

How will a shipper know if it is in compliance with BNSF's coal dust mitigation requirements?

The Coal Loading Rule contains a "safe harbor" provision stating that a shipper will be deemed to be in compliance with BNSF's Coal Loading Rule if it loads cars in compliance with BNSF's published Load Profile Template, and applies one of seven approved topper agents to the loaded cars in the manner specified by the topper manufacturer. In addition, the Coal Loading Rule provides that a shipper may use another method of coal dust suppression if the shipper can demonstrate that, together with load profiling, the other method reduces coal dust losses in transit by the required 85%.

Who decides what topper agent will be applied at the mines?

The shipper and its mine agent decide on the topper to be applied to the shipper's coal. The safe harbor provision in BNSF's Coal Loading Rule identifies seven topper agents that have been shown to reduce coal dust losses by at least 85% when used in conjunction with coal load profiling. A shipper and its mine agent may choose to use any one of the seven approved topper agents. As detailed below, a shipper may also seek approval for the use of additional topper agents if the shipper can show that use of the additional topper agent, along with coal load profiling, achieves at least an 85% reduction in coal dust losses.

Are shippers allowed to adopt other mitigation methods?

BNSF has been conducting scientific studies of coal dust for several years that show that there are practicable methods of substantially reducing coal dust releases in the PRB, and such methodologies are currently being deployed at mines in the PRB and in areas outside the PRB. The most common measure has been the application of a dust suppression topper agent (e.g., surfactant) to the coal shipment at the time of loading. Topper agents have been used with positive results for several years in Canada, in the eastern United States, in Australia, and most recently in China.

Other coal dust reduction technologies are being explored and developed. As discussed in more detail below, BNSF has an established process and a demonstrated record of working with shippers, mines and third-party vendors to test new dust reduction technology. BNSF is confident that as coal shippers continue efforts to implement measures and develop best practices, the market will continue to respond with mitigation products and processes that are increasingly effective from a technological and cost perspective.

Has BNSF's Coal Loading Rule been approved by the Surface Transportation Board?

BNSF's Coal Loading Rule has been in effect since October 1, 2011. When BNSF established its Coal Loading Rule, several coal shippers challenged the validity of that Rule before the Surface Transportation Board (STB). In a prior proceeding, the STB concluded that coal dust is a harmful contaminant of rail ballast and that it was appropriate for BNSF to prevent the loss of coal through appropriate coal loading rules rather than deal with coal dust after it has escaped from loaded cars through expanded maintenance of the rail lines. Recently, the STB issued a decision in Finance Docket No. 35557: Reasonableness of BNSF Railway Company Coal Dust Mitigation Tariff Provisions in which the STB affirmed the reasonableness of BNSF's specific Coal Loading Rule and upheld its enforceability, subject to a minor modification that BNSF implemented effective January 13, 2014.

BNSF expects that shippers will comply with these STB decisions and timely implement coal dust mitigation measures to effectively mitigate against the release of coal dust from rail cars in transit.

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